Debt Collection Defense
Most debt collection cases in New York end in default judgment, not because the debt is valid but because the defendant did not respond in time. We defend the cases that other firms tell people are not worth fighting.
What We Handle
Defending Collection Lawsuits
If a debt collector or debt buyer has sued you, you have 20 or 30 days to file an answer in NYC Civil Court or NY Supreme Court, depending on how you were served. Miss the window and you lose by default. The case will then convert into a judgment that the creditor can use to freeze your bank account, garnish your wages, and lien any real property you own.
We respond on time, raise every available defense in the answer (statute of limitations, lack of standing, failure to state a claim, payment, accord and satisfaction), and litigate motions to dismiss and for summary judgment. The CPLR mechanics live in 320 (response deadlines), 3211 (pre-answer motions), 3212 (summary judgment), and 3018(b) (affirmative defenses). The substantive defenses depend on what kind of debt and what kind of plaintiff.
Vacating Default Judgments
Most people learn about a default judgment the day their bank account is frozen or their paycheck is garnished. By that point the case is months or years old, and the creditor is in collection mode. The judgment can still be challenged.
CPLR 5015(a)(1) allows a court to vacate a default if the defendant shows a reasonable excuse for not responding and a meritorious defense. CPLR 5015(a)(4) allows vacatur at any time for lack of jurisdiction, which most often means defective service ("sewer service" by a process server who never actually delivered the papers). CPLR 317 provides another path for defendants who were not personally served and did not appear, within one year of learning of the judgment. Each path has different proofs and different deadlines, and the right one depends on the facts of how the case was served and what happened next.
Bank Levy and Wage Garnishment Relief
A frozen bank account or a garnished paycheck does not always mean the creditor is entitled to the money. Federal and New York law protect significant categories of income from collection: Social Security, SSI, SSDI, veterans' benefits, public assistance, child support received, and 90% of recent earnings deposited in a bank account.
CPLR 5222-a and the Exempt Income Protection Act (EIPA) require banks to send debtors specific exemption claim forms when an account is restrained, and to release exempt funds without further legal action. We file exemption claims, move to vacate restraining notices that violated the EIPA, and pursue the creditor for damages where the violation was willful. For wage garnishment, CPLR 5231 caps income executions at 10% of gross or 25% of disposable earnings, whichever is less, and exempts debtors earning under 30 times the minimum wage.
FDCPA and Consumer Protections
The Fair Debt Collection Practices Act (15 U.S.C. 1692) limits what third-party debt collectors can do: when they can call, what they can say, who they can contact, and what representations they can make about the debt. Violations carry statutory damages of up to $1,000 plus actual damages and mandatory attorney fees, which means the law itself pays for the case if you have a real claim.
New York General Business Law 349 reaches deceptive practices more broadly and is not limited to third-party collectors. New York's debt collection regulations under 23 NYCRR 1 (the DFS rules) layer additional state-law protections on top. We pursue FDCPA and GBL 349 claims directly, raise them as counterclaims in collection lawsuits where appropriate, and use them as leverage in settlement negotiations.
Debt Buyer Defenses
Most credit card collection lawsuits in New York are filed by debt buyers (Midland Credit, Portfolio Recovery, LVNV Funding, Cavalry SPV, and similar) who purchased the debt from the original creditor for pennies on the dollar. To win the case, the debt buyer has to prove that it actually owns the debt, that the amount claimed is correct, and that the lawsuit was filed in time.
That proof requires a chain of assignment from the original creditor through every intermediate buyer to the plaintiff, plus admissible business records establishing the balance. NYC Administrative Code 20-493.1 and 22 NYCRR 208.6 require specific documentation to be attached to debt buyer complaints filed in NYC. Many debt buyers cannot produce it. Statute of limitations is six years for breach of contract under CPLR 213(2), running from the date of the last payment or default, and is a complete defense if the case was filed too late.
Our Approach
We start every collection defense by checking three things before any substantive response: when the last payment was made (statute of limitations), what the chain of assignment actually shows (standing), and whether the plaintiff complied with the documentation requirements for debt buyers in NYC. Many cases are resolved by these threshold issues alone, without ever reaching the merits of the underlying debt.
When the case has to be litigated, we litigate it. When it should be settled, we settle from the leverage that comes from being prepared to win. The clients who get the worst outcomes in this practice area are the ones who agreed to a stipulation of settlement at the courthouse without knowing what they were waiving.
Common Questions
What should I do if a debt collector contacts me?
Request written verification of the debt within 30 days of their first contact. The collector must stop collection activity until they provide verification. Do not acknowledge the debt, make payments, or provide personal financial information until you have confirmed the debt is valid and within the statute of limitations.
Source: FDCPA, 15 U.S.C. § 1692g
What is the statute of limitations on debt in New York?
6 years for most consumer debts, including credit cards, personal loans, and medical bills. The clock starts from the date of last payment or last activity. If the statute has expired, the debt is time-barred and the collector cannot sue you. Making any payment resets the clock.
Source: N.Y. CPLR § 213(2)
Can a debt collector garnish my wages in New York?
Only with a court judgment. Even then, New York limits garnishment to 10% of gross wages or the amount by which weekly disposable earnings exceed 30 times the minimum wage, whichever is less. Certain income (Social Security, disability, unemployment, public assistance) is fully exempt from garnishment.
Source: N.Y. CPLR § 5231; 15 U.S.C. § 1673
What are my rights under the Fair Debt Collection Practices Act?
Collectors cannot call before 8 AM or after 9 PM, use threats or profanity, misrepresent the amount owed, contact your employer (except to verify address), or continue collection after you dispute in writing. Violations entitle you to statutory damages of up to $1,000 per lawsuit plus actual damages and attorney fees.
Source: FDCPA, 15 U.S.C. §§ 1692c-1692f
Can a debt collector sue me for an old debt?
They can file a lawsuit, but if the 6-year statute of limitations has expired, you have an affirmative defense. You must raise this defense in your answer or you waive it. Many debt buyers sue on time-barred debts hoping consumers will not respond. Always answer a summons, even for old debts.
Source: N.Y. CPLR § 213(2)